Investment chief worries micro market lacks incentives for retail backing

AS the Jamaica Stock Exchange prepares to launch its Micro Market in April 2026, Herbert Hall, CEO of Cumax Wealth, is calling for potential government-backed incentives to support broker-dealers involvement, warning that the success of the initiative may depend on more than just lower listing fees and streamlined compliance.

“With the Junior Market, it’s a trick of the trade which is really known, that brokers typically take a position in junior market companies, right? And then, once it is listed, they liquidate their position and that is how they sort of create their fees. Now we can’t really do that for a micro just by virtue of the numbers. So is there some sort of incentive from Government, I don’t know, tax relief, I don’t know?” Hall questioned during the Cumax Wealth Management Spring Investment Forum.

He suggested that without incentives, such as tax relief, to make participation financially attractive for brokers, the market may struggle to gain traction. The JSE’s Micro Market is expected to target businesses seeking between $5 million and $50 million in equity, part of a broader push to expand access to capital for small and emerging enterprises. A steering committee has been formed to examine proposals and guide policy ahead of the market’s launch. While the initiative is being welcomed as a new financing avenue for Jamaica’s smallest businesses, concerns were raised during the forum about investor exposure, particularly among retail investors who may lack the capacity to absorb losses. Commercial banks and large financial institutions have traditionally avoided lending to start-ups and microenterprises due to their high failure rates, making equity financing one of the few available options. A question raised during the forum was whether firms at this scale are truly ready for listing and whether unsophisticated investors could face outsized risks. JSE Managing Director Marlene Street Forrest acknowledged the concerns but maintained that the solution lies in building safeguards, not restricting access.

“If we do not provide access to patient capital, growth also will elude us. This is how companies will grow. This is how companies will become competitive,” said Street Forrest.

Street Forrest pointed to the early days of the Junior Market, which faced similar scepticism. Many of the companies that helped shape Jamaica’s SME landscape today were once viewed as too small or too risky for listing. She emphasised that while the Micro Market will require a different approach, the JSE is building mechanisms to manage that risk, including utilising technology to help these companies remain compliant.

“The stock exchange is not going into anything that will destroy the confidence that people already have in us,” Street Forrest asserted. “We will be putting the governance in place to ensure that when investors invest, they can be confident of a return and that the companies are properly managed.”

To ease entry for small businesses, the Jamaica Stock Exchange (JSE) plans to replicate and enhance the fee concession model currently used for entities listing on its Junior Market. Those companies pay only 50 per cent of the fees required for the Main Market listings – a structure that has helped attract many small and medium enterprises to public listing. According to Street Forrest, similarly reduced listing fees will apply to the upcoming Micro Market, but with additional efforts to make the process more accessible for very small businesses.

“We believe this is an investment in Jamaica. So the companies that will come to the micro market will pay less in terms of the listing costs,” she said.

In addition to fee reductions from the JSE itself, discussions are already underway with member dealers, attorneys, and accountants to keep professional services affordable for micro-entrepreneurs looking to go public. These services, which include regulatory filings, audits, legal compliance, and share structuring, are often cost-prohibitive for small operators. In the meantime, the gazetted increase of the Junior Market’s market capitalisation threshold from $500 million to $750 million is expected to pave the way for a rejuvenation of listing activity on the stock market.

“Last year we listed 10 securities. This year, our target is 14,” said Street Forrest. “Expect to see more IPOs, and you could expect APOs as well.”

The higher threshold is expected to widen access to equity financing for more small and medium-sized enterprises, particularly those nearing the previous ceiling for Junior Market participation and will support a growing pipeline of listings and address long-standing concerns about market liquidity, which the JSE says is best tackled by expanding the number of listed companies.